The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Hub Group (NASDAQ:HUBG) and the rest of the air freight and logistics stocks fared in Q1.
The growth of e-commerce and global trade continues to drive demand for expedited shipping services, presenting opportunities for air freight companies. The industry continues to invest in advanced technologies such as automated sorting systems and real-time tracking solutions to enhance operational efficiency. Despite the advantages of speed and global reach, air freight and logistics companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.
The 7 air freight and logistics stocks we track reported an ok Q1; on average, revenues were in line with analyst consensus estimates. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, but air freight and logistics stocks have performed well, with the share prices up 11.1% on average since the previous earnings results.
Weakest Q1: Hub Group (NASDAQ:HUBG) Started with $10,000, Hub Group (NASDAQ:HUBG) is a provider of intermodal, truck brokerage, and logistics services, facilitating transportation solutions for businesses worldwide.
Hub Group reported revenues of $999.5 million, down 13.3% year on year, falling short of analysts' expectations by 5.3%. Overall, it was a weak quarter for the company with a miss of analysts' volume estimates.
“I am pleased with the team’s performance in the first quarter, resulting in $1.0 billion of revenue, in-line with fourth quarter performance despite normal seasonal declines and challenging market conditions. Our yield management, cost containment and operating efficiency initiatives resulted in operating income margin of 3.7% of revenue, an improvement over the fourth quarter. The team continues to execute on our key strategic priorities including diversification of our business and a focus on cost management that will lead to enhanced earnings stability and growth over the long term,” said Phil Yeager, Hub Group’s Vice Chairman of the Board of Directors, President and Chief Executive Officer.
Hub Group delivered the weakest performance against analyst estimates of the whole group. The stock is up 11.7% since reporting and currently trades at $44.93.
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Best Q1: C.H. Robinson Worldwide (NASDAQ:CHRW) Engaging in contracts with tens of thousands of transportation companies, C.H. Robinson (NASDAQGS:CHRW) offers freight transportation and logistics services.
C.H. Robinson Worldwide reported revenues of $4.41 billion, down 4.3% year on year, outperforming analysts' expectations by 3.1%. It was a stunning quarter for the company with an impressive beat of analysts' earnings estimates and a solid beat of analysts' Global Forwarding revenue estimates.
C.H. Robinson Worldwide delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 21.3% since reporting. It currently trades at $87.40.
Expeditors (NYSE:EXPD) Expeditors (NYSE:EXPD) offers air and ocean freight as well as brokerage services.
Expeditors reported revenues of $2.21 billion, down 14.9% year on year, in line with analysts' expectations. It was a weak quarter for the company with a miss of analysts' Airfreight revenue estimates.
Expeditors had the slowest revenue growth in the group. Interestingly, the stock is up 4% since the results and currently trades at $120.29.
United Parcel Service (NYSE:UPS) Trademarking its recognizable UPS Brown color, UPS (NYSE:UPS) offers package delivery, supply chain management, and freight forwarding services.
United Parcel Service reported revenues of $21.71 billion, down 5.3% year on year, falling short of analysts' expectations by 1%. Zooming out, it was a mixed quarter for the company with a decent beat of analysts' earnings estimates.
The stock is flat since reporting and currently trades at $145.30.
FedEx (NYSE:NYSE:FDX) Infamously taking its last $5,000 to a Las Vegas blackjack table to keep the company afloat, FedEx (NYSE:FDX) is a provider of parcel and cargo delivery services
FedEx reported revenues of $22.11 billion, flat year on year, in line with analysts' expectations. Zooming out, it was an ok quarter for the company with a narrow beat of analysts' earnings estimates.
The stock is up 19.7% since reporting and currently trades at $306.76.
This content was originally published on Stock Story
